More than 900,000 Czechs struggled to pay energy bills last year. The crisis is worsening the situation

Half a million Czech households were affected by energy poverty in 2021, even before the sharp price rises. Higher subsidies for home insulation or window replacement under the Nová zelená úsporám Light programme could help them. This follows from a new study.

Energy poverty affected more than 900,000 people in Czechia in 2021. It hit low-income households with children and single mothers the hardest, affecting around 220,000 Czech children. Up to 28 percent of people living alone and receiving a pension also face hardship, with women accounting for the majority among them. This is highlighted by a study prepared by Hnutí Duha, the Platform for Social Housing, the Za bydlení initiative and the University of Ostrava.

According to the study, people at risk of energy poverty spend a large share of their income on energy, cannot afford to heat their homes adequately or report energy debts. Affected households also have below-average incomes.

The study is based on data on household living conditions from last spring, published by the Czech Statistical Office. Its authors propose several specific steps the government can take to help people in energy poverty. They recommend better targeting benefits and energy discounts at the most vulnerable population groups.

The study also stresses the importance of adopting a housing support law, improving the availability of energy advice, introducing special programmes for renovating rental housing and building energy-efficient social housing. It proposes raising the minimum energy standard for buildings used as rental housing.

Energy-intensive buildings are the problem

At least 1.8 million people in Czechia live in buildings with high energy consumption. As a result, they have to pay higher amounts for electricity and heating. According to the study, energy poverty among a significant share of households is linked to the poor condition of the buildings in which they live.

Replacing windows, insulating homes or installing rooftop photovoltaics could help them. However, people at risk of energy poverty cannot afford the necessary investment in renovations. “Comprehensive renovations are essential to tackling energy poverty and reducing greenhouse gas emissions,” Ondřej Pašek of Hnutí Duha told Ekonews.cz.

“Without thorough insulation, vulnerable households will never escape the vicious circle of poor housing and high heating bills,” Pašek says. At present, he says, subsidies from the environment ministry’s Nová zelená úsporám programme are out of reach for low-income households because of the high co-financing requirement. The study therefore says that subsidies for energy renovations need to be better targeted at people at risk of energy poverty.

The state could cover up to 95 percent of insulation costs

For family houses occupied by households with a net income of up to 17,500 koruna per person, the study’s authors propose reimbursing 95 percent of the project cost, as is the case with boiler replacement subsidies. Households with a net income of up to 21,000 koruna per person should receive 75 percent of costs back, they say. Other eligibility conditions should remain the same. The authors also recommend offering favourable loans to cover co-financing.

“What is important is that 100 percent of households in energy poverty – that is, 160,000 households in owner-occupied family houses, home to more than 280,000 people and nearly 50,000 children – would meet the proposed conditions for entitlement to a 95 percent subsidy, the study states.

The study also recommends specifically selecting apartment buildings inhabited by people from vulnerable groups and offering them a time-limited subsidy from Nová zelená úsporám worth 75 percent of costs.

Ministry plans insulation measures

“We plan to submit to the government for consideration a proposal for a subsidy scheme under the HOUSEnerg programme of the Modernisation Fund to move away from gas, again targeted at the most vulnerable households,” Dominika Pospíšilová from the environment ministry’s press office told Ekonews.cz. In the new year, the ministry plans to launch boiler replacement subsidies and has also postponed the deadline for the final ban on certain types of boilers.

Pospíšilová adds that applications for Nová zelená úsporám Light will open on 9 January next year. The programme offers funding for insulating façades, roofs and ceilings, or replacing windows and entrance doors, without the need to provide a project or energy calculations.

“Nová zelená úsporám Light is intended to help the most vulnerable households affected by energy poverty that do not have enough money for upfront financing,” Pospíšilová explains. Support for a single house amounts to 150,000 koruna, and the subsidy can be provided as an advance before the renovation.

Republished from the EkoNews.cz online portal, a website covering business and sustainability.